INTENDED FOR PARTNER USE AND NOT FOR CLIENT DISPERSION

This series is designed to support our REALTOR® partners during a buyers' market by highlighting unique property types and financing solutions. We hope to provide you with knowledge that will set you apart from the rest of the field and arm you with tools to use for your future listings.

Have a unique listing that may be challenging to obtain financing for? Reach out! We're happy to preview listings and arm you with the information you need from a lender's perspective.

ACREAGES

• Watch out for limitations on: loan to value, number of acres accepted in an appraisal, number of buildings/outbuildings to be allowed in the appraisal, or allowable farming activity.
• Many lenders will look at ALR.
• Farming Activity:
• Case-by-case; many lenders will not allow any farming income to be included in the application.

MOBILE/MANUFACTURED/MODULAR HOMES

• More financing options are available for homes on owned land.
• Age of home is considered and may rule out lender options.
• CMHC Insurance likely to be required.
• Not able to be refinanced.
• Home Insurance (replacement cost) can be difficult to obtain if the home is too old. This can directly impact financing.

MICRO UNITS

• Location dependent but a handful of lender options available that will finance as small as 300 sqft.
• Many options available for units as small as 500 sqft.

LIMITED ACCESS PROPERTIES

• Lenders are limited if there is only seasonal road or water only access.

LOG HOMES

• Lender pool is limited. There may be limitations on loan to value. Generally, the home needs to make sense for the area.

RAW LAND

• Many lenders will only look at raw land when presented with a construction mortgage.
• A few lenders will look at fully serviced (electricity, water, and sewer to the lot) land up to 75% loan to value. If it's not fully serviced, max 65% loan to value.

FOUNDATIONS

• Most common foundation type is concrete.
• Pressure treated wood foundations are considered by a handful of lenders depending on the age and condition.

PROPERTIES WITH MULTIPLE PIDs

• The physical location of the home on the property will have a determining factor on which lenders will and will not entertain.
• A site survey may be required to determine the position of the building(s).
• Not all lenders will entertain with multiple PIDs.

SEASONAL PROPERTIES

• Limited lender pool but can be considered when there is not fractional ownership involved.
• Can be considered in cases where the property is involved in short term renting but the rental income cannot be considered in the application.

LEASED LAND

• More and more lenders are offering financing on these types of properties.
• Depends on the length of the lease (and time remaining).
• Often an approved list of developments that can be considered.

GROW-OPs

• Limited lending options. Likely require CMHC approval.
• Full remediation report, air quality test, city approval/permits, title insurance, appraisal, Level 1 Environmental Assessment, and RCMP report likely required.
• Purpose of purchase to be considered - likely only to be considered for owner-occupancy.

REMEDIATION FOR VERMICULITE/ASBESTOS

• If vermiculite is disclosed on a PDS, this will often trigger requirements for remediation and/or proof of previous remediation.
• An air quality test will be required.

UNIQUE WATER SOURCES

• Any water source that isn't a traditional municipal or private well, may limit the lender pool available. Potential unique water sources include (but are not limited to): shared well, cistern, river, stream, artisanal well, lake or spring.
• Additional documentation may be required for a shared well in the form of a water well certificate and an agreement between parties confirming long term use and maintenance of the well & pump. For surface water, may require a copy of the provincial water license.
• Likely a requirement for additional title insurance in lieu of water testing or in addition to water quality testing.

HERITAGE HOMES

• Home that are listed on the Heritage Home Registry will have a limited lender pool. If your client is pre-approved, ensure the lender they are approved with allows Heritage Homes to be financed through them.

SUITES (AUTHORIZED vs UNAUTHORIZED / LEGAL vs ILLEGAL)

• New appraisal guidelines now require the differentiation between a suite that is authorized or unauthorized (legal or illegal).
• If a suite is authorized or legal, an appraiser can complete a market rent analysis if it is required by the lender for financing purposes.
• If a suite is unauthorized or illegal, a market rent analysis cannot be completed and only a Consulting Report can be completed. A Consulting Report can only verify if the reported rents or leases are reasonable. Depending on the financing scenario, a Consulting Report may not provide the necessary information.

PARTIALLY FINISHED HOMES

• Depending on the level of completion, a client may be eligible for a purchase plus improvements program. This would require quotes from a builder/contractor as well as cash or credit on hand for the client to complete the improvements before being reimbursed after they are completed. See our Purchase Plus Improvements Info Sheet HERE.
• If the level of completion is low, a client may be required to enter into a construction loan. This would involve a draw process and an equity requirement to ensure there is liquid cash on hand to fulfill the obligations of the draw process. Construction Info Sheet HERE.

BYLAW CONTRAVENTIONS

• Homes that have a bylaw contravention notice on title will have a limited lender pool. If your client is pre-approved, ensure the lender they are approved with allows a property with a bylaw contravention to be financed through them.